One of India's leading internet service providers, Satyam Infoway (Sify), is close to acquiring Masti.com, a portal for teenagers owned by consumer goods giant Procter & Gamble.

A Sify spokesman said the deal was not yet complete, but Reuters reports that only a few details need to be finalised.

"We are in talks with them... the talks are still on," the spokesman said.

Established in 1998, Sify offers software and e-commerce applications and operates the consumer portal Sify.com.

Sify overtook its main rival Rediff.com in terms of revenue in the April-to-June quarter, according to figures from DSP Merrill Lynch.

Masti.com - named after a Hindi word for frolic - was launched nine months ago by Procter & Gamble as "a youth portal which functions as a learning opportunity for the company" and reportedly has more than 170,000 registered users.

India's internet struggle

The Nasdaq-listed Sify rose to prominience two years ago as it acquired a number of ISPs in an attempt to dominate the expatriate Indian market.

But like much of the industry, Sify has been hit by the global economic slowdown and the collapse of the dot.com sector.

Earlier this month Rediff and Sify were given a temporary reprieve from delisting that usually follows being quoted below $1 for a period of three months.

Lycos Asia, one of the region's largest networks, on Friday said it would close its Indian operations and and cut 17 workers, though its portal would continue to operate from Singapore.

In August, Rupert Murdoch's Star Network, owned by News Corp, bought control of Indian consumer internet portal indya.com at a discount price as part of its expansion across South Asia.